Johannesburg
– Sibanye Gold, which has been on an acquisition trail, is set to buy New
York-listed Stillwater for R30 billion.
In a
statement released on Friday, the South African gold and platinum miner said the
deal presents the opportunity for it to transform into a premier, global precious
metals miner, with a balanced portfolio of gold and platinum group metals assets,
at a favourable point in the commodity cycle.
Sibanye CEO
Neal Froneman says the deal is consistent with the company’ strategy of “creating
superior value for all of our stakeholders, by enhancing the cash flow
generation and growth profile of its portfolio, underpinning its strategy of
paying sustainable, industry leading dividends.”
He adds the
purchase is an opportunity for Sibanye to acquire high-quality, low-cost PGM
assets which offer near-term organic growth through the anticipated ramp-up of Stillfontein’s
Blitz Project. “The extensive strike length of the mineralised orebody suggests
that there may be further upside potential.”
Stillwater
is the only US miner of PGM and the largest primary producer of PGM outside of South
Africa and the Russian Federation. Located in Montana, US, Stillwater’s
operations consist of
two underground PGM mines (the Stillwater Mine and East Boulder Mine), the
Blitz Project and the Columbus metallurgical complex.
Read also: Sibanye clears last hurdle for acquisition of mines
Development
of the Blitz Project is expected to be completed in early 2018.
In October,
Sibanye was cleared to buy Anglo American Platinum's Rustenburg mines for $330
million, which followed its $294 million takeover of Aquarius Platinum last
year.
Those deals
put the producer, South Africa's second-largest gold producer by market value,
into the global top five producers of platinum group metals with annual output
of more than a million ounces.
BUSINESS REPORT